Chalco plans $1.46b share placement

The listed arm of Aluminum Corp of China (Chinalco), known as Chalco, wants to raise up to US$1.46 billion through the placement of up to 1 billion A-shares, the South China Morning Post reported. Chalco said it would invest approximately US$541.71 million of the proceeds in the Xing Xian alumina project, US$336.74 million in the Chongqing alumina project and US$292.82 million in the Zhongzhou Ore-dressing Bayer Process expansion project; the rest would go into working capital. The company is banking on increased demand for alumina from Beijing’s stimulus package and rising automotive sales. The share placement comes as sources close to Chalco’s parent company said Chinalco would be participating in Rio Tinto’s rights offering and taking its full share. Last month, a proposed deal for Rio to receive a US$19.5 billion investment from Chinalco fell apart. Rio instead decided to launch a rights offer and form a joint venture with BHP Billiton.